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Financial Aid estimate resources?

colorado_momcolorado_mom 9230 replies83 threads Senior Member
I am trying to advise a parent of high school junior about financial aid estimating resources, but my own experience is almost 10 years old. Is this a good place to start? - https://studentaid.gov/understand-aid/estimate

Or do parents tend to look for more college-specific estimators, once some target colleges are defined?
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Replies to: Financial Aid estimate resources?

  • Mwfan1921Mwfan1921 3269 replies61 threads Senior Member
    edited January 19
    I am trying to advise a parent of high school junior about financial aid estimating resources, but my own experience is almost 10 years old. Is this a good place to start? - https://studentaid.gov/understand-aid/estimate

    Or do parents tend to look for more college-specific estimators, once some target colleges are defined?

    Yes, use the NPCs for each specific school, but some require FAFSA EFC (actual or estimated).....so do complete the fafsa4caster at the link above.

    Some NPCs are more accurate than others, and for merit giving schools some will include that merit, some won't. So you do have to look into the details.

    Good luck.
    edited January 19
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  • thumper1thumper1 76426 replies3379 threads Senior Member
    @ucbalumnus I put that about divorced parents in my post above.

    If you answer NO to all of these questions, the net price calculators will give a decent estimate:

    1. Are the parents divorced?

    2. Do the parents own a business?

    3. Are the parents self employed?

    4. Do the parents own real estate in addition to their primary residence?

    5. Is there any foreign earned income? This can complicate things too.

    6. Is the student a citizen of another country?

    If no to all the above, and the family has really W-2 income from employers only...then the NPCs are a good starting point.

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  • politepersonpoliteperson 424 replies4 threads Member
    Myintuition.org has a simplified estimator and includes quite a few schools. Most people can probably fill it out without using tax forms. It provides a good ballpark estimate and also makes the range of “need” calculations apparent. Then I’d follow up with the more detailed NPC at schools of interest, which require more info and will be more accurate.
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  • thumper1thumper1 76426 replies3379 threads Senior Member
    @politeperson

    There have been reports on this site about the inaccuracy of myintuition.com. If you can complete this by guessing numbers instead of using your tax forms, it’s likely not going to be as accurate as the net price calculators on the college sites.

    It’s always best to use college specific estimators, and VERY accurate numbers from tax returns and assets. Garbage in, garbage out.

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  • politepersonpoliteperson 424 replies4 threads Member
    edited January 19
    @thumper1 Yes, as I mentioned, the NPC will be more precise because it asks for more detailed information. But myintuition is a good place to start in order to get a ballpark range based on very few questions. It is, in fact, a “college specific estimator”, and colleges themselves point people to it as a first step for an early estimate.
    edited January 19
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  • brantlybrantly 4062 replies71 threads Senior Member
    thumper1 wrote: »
    @ucbalumnus I put that about divorced parents in my post above.

    If you answer NO to all of these questions, the net price calculators will give a decent estimate:

    1. Are the parents divorced?

    2. Do the parents own a business?

    3. Are the parents self employed?

    4. Do the parents own real estate in addition to their primary residence?

    5. Is there any foreign earned income? This can complicate things too.

    6. Is the student a citizen of another country?

    If no to all the above, and the family has really W-2 income from employers only...then the NPCs are a good starting point.

    Regarding #6 ... my spouse and I are both self-employed, 1099 workers. We have found NPCs to be very accurate. We are in professions that have no assets and no sale value. Examples of such professions include: consultant, tutor, counselor, freelance journalist, freelance graphic artists, musicians.
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  • thumper1thumper1 76426 replies3379 threads Senior Member
    edited January 19
    @brantly

    You are lucky. If you don’t take business deductions for tax purposes it would be OK.

    But some colleges do add back some business deductions as income
    edited January 19
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  • brantlybrantly 4062 replies71 threads Senior Member
    thumper1 wrote: »
    @brantly

    You are lucky. If you don’t take business deductions for tax purposes it would be OK.

    But some colleges do add back some business deductions as income

    We do take business deductions. But they are reasonable and expected. Office rent is the biggest one. The ones that FA offices don't like are things like depreciation on equipment and multiple thousands in entertainment expenses.
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  • menloparkmommenloparkmom 12502 replies543 threads Senior Member
    ^^^they ALSO add back in deductions for IRA retirement accts.
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  • ucbalumnusucbalumnus 80092 replies719 threads Senior Member
    thumper1 wrote: »
    Garbage in, garbage out.

    Probably why divorced parent situations give so much trouble. Many divorced parents do not want to reveal finances to each other, so no one person can know all of the correct information to put in the net price calculator (even if it accounts for divorced parent situations like many do).
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  • thumper1thumper1 76426 replies3379 threads Senior Member
    @brantly exactly...entertainment, travel, cell phones, home office and home office utilities, clothing (unless it is something very specialized). Those deductions frequently get added back in because they are expenses you would have anyway...even without your business.
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  • colorado_momcolorado_mom 9230 replies83 threads Senior Member
    Wow - thanks for all the feedback.

    I thought of other general tips for parents new to these threads (other should feel free to clarify / expand as needed)

    1) SIBLINGS: The family EFC (Expected Family Contribution) is spread across the in-college students (at least for FAFSA I think; CSA may vary). So even if no need-based Financial Aid possible with first child alone, that could change for years with more than one student in college.

    2) At most schools, you can't "stack" Merit Scholarships and need-based Financial Aid.

    3) Many schools are not able to meet "Full Need" (by FAFSA or CSA forumulas) . Or if they do it may be heavy on parent loans. The Ivy League schools are hard admits, but they seem to have best chance to meet full need.
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  • thumper1thumper1 76426 replies3379 threads Senior Member
    For FASFA purposes, when there are two in college, the total EFC will be split roughly 50/50. BUT this doesn’t mean your student will get a nickel more of need based aid when a sibling joins them in college. Most schools don’t meet financial need for all...so this expectation of more money with more kids in college shouldn’t be an expectation.

    For Profile schools, the total family contribution is usually 60/60. But again...not every school meets full need.

    A suggestion that is less than perfect...run the net price calculator with one in college, and then again with 2 in college. See what the difference is. But keep in mind, the NPCs are set up for incoming freshmen so this should not be a laid in stone estimate
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  • colorado_momcolorado_mom 9230 replies83 threads Senior Member
    "Most schools don’t meet financial need for all... " - Excellent reminder.

    The Need (Cost - EFC) is the best case assistance, but at most schools the Financial Aid package will not cover full Need.
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  • ucbalumnusucbalumnus 80092 replies719 threads Senior Member
    edited January 20
    2) At most schools, you can't "stack" Merit Scholarships and need-based Financial Aid.

    Some have limited stacking, where merit scholarships can replace expected student work earnings, federal direct loans, and/or unmet need before reducing FA grants. However, only a few colleges publicly state their policies on how merit scholarships and need-based FA are handled.

    Some have discounts that are both merit and need based. These can include merit scholarships whose amount varies by need, merit scholarships that have some need-based eligibility requirements, need-based grants that require a specific level of academic stats (e.g. some state grants), or need-based aid that is "preferentially packaged" to admitted students that the college is most interested in enticing to matriculate.
    edited January 20
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  • brantlybrantly 4062 replies71 threads Senior Member
    ^^^they ALSO add back in deductions for IRA retirement accts.

    For everyone. Not just self-employed.
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  • colorado_momcolorado_mom 9230 replies83 threads Senior Member
    From what I remember, 401K deductions for the year are counted (ie "add back")... but the 401K balance is excluded from asset list. I was going to try to google to verify, but not sure the links would be permitted here.
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